From 1 January 2026, the new tax laws will provide many reliefs and exemptions for low-income earners, average taxpayers, and small businesses including:
๐ERSONAL ๐NCOME ๐AX ( ๐๐๐๐)
1. Individuals earning the national minimum wage or less (exempt)
2. Annual gross income up to โฆ1,200,000 (translating to about โฆ800,000 taxable income) is exempt
3. Reduced PAYE tax for those earning annual gross income up to โฆ20 million
4. Gifts (exempt)
๐LLOWABLE ๐EDUCTIONS & ๐ELIEFS FOR INDIVIDUALS
5. Pension contribution to PFA
6. National Health Insurance Scheme
7. National Housing Fund contributions
8. Interest on loans for owner-occupied residential housing
9. Life insurance or annuity premiums
10. Rent relief – 20% of annual rent (up to โฆ500,000)
๐ENSIONS & ๐RATUITIES – ๐XEMPT
11. Pension funds and assets under the Pension Reform Act (PRA) are tax-exempt.
12. Pension, gratuity or any retirement benefits granted in line with the PRA
13. Compensation for loss of employment up to โฆ50 million
๐APITAL ๐AINS ๐AX (๐๐๐) – ๐XEMPT
14. Sale of an owner-occupied house
15. Personal effects or chattels worth up to โฆ5 million
16. Sale of up to two private vehicles per year
17. Gains on shares below โฆ150 million per year or gains up to โฆ10 million
18. Gains on shares above exemption threshold if the proceed is reinvested
19. Pension funds, charities, and religious institutions (non-commercial)
๐OMPANIES ๐NCOME ๐AX (๐๐๐) – ๐XEMPT
20. Small companies (turnover not more than โฆ100 million and total fixed assets not more than โฆ250 million) pay 0% tax
21. Eligible (labelled) startups are exempt
22. Compensation relief – 50% additional deduction for salary increases, wage awards, or transport subsidies for low-income workers
23. Employment relief – 50% deduction for salaries of new employees hired and retained for at least three years
24. Tax holiday for the first 5-years for agricultural businesses (crop production, livestock, dairy etc)
25. Gains from investment in a labeled startup by venture capitalist, private equity fund, accelerators or incubators
๐EVELOPMENT ๐EVY – ๐XEMPT
26. Small companies are exempt from 4% development levy
๐ITHOLDING ๐AX – ๐XEMPT
27. Small companies, manufacturers and agric businesses are exempt from withholding tax deduction on their income
28. Small companies are exempt from deduction on their payments to suppliers
๐ALUE ๐DDED ๐AX (๐๐๐) – 0% ๐XEMPT
29. Basic food items – 0% VAT
30. Rent – Exempt
31. Education services and materials – 0% VAT
32. Health and medical services
33. Pharmaceutical products – 0% VAT
34. Small companies (โค โฆ100m turnover) are exempt from charging VAT
35. Diesel, petrol, and solar power equipment – VAT suspended or exempt
36. Refund of VAT on assets and overheads to produce VATable or 0% VAT goods and services
37. Agricultural inputs – fertilizers, seeds, seedlings, feeds, and live animals
38. Purchase, lease or hire of equipment for agric purposes
39. Disability aids – hearing aids, wheelchairs, braille materials
40. Transport – shared passenger road transport (non-charter)
41. Electric vehicles and parts – exempt
42. Humanitarian supplies – exempt
43. Baby products
44. Sanitary towels, pads or tampons
45. Land and building
๐TAMP ๐UTIES – ๐XEMPT
46. Electronic money transfers below โฆ10,000
47. Salary payments
48. Intra-bank transfers
49. Transfers of government securities or shares
50. All documents for transfer of stocks and shares
Share this good news with everyone you care about who needs to know.
๐๐๐ ๐๐๐๐๐๐๐๐ ๐ ๐๐ ๐๐๐๐
Nominate a content creator whoโs been educating their audience about Nigeriaโs new tax reform laws or someone youโd like to see do so.
Weโll be selecting the top 20 creators with the most nominations for a special training to help them share accurate, balanced, and useful tax information with their followers.
Misinformation spreads fast, often to the authorโs benefit but to the audienceโs loss. Accurate information may travel slower, but it empowers everyone, and earns lasting trust.
Tag or mention your favourite influencer to nominate or fill the nomination form forms.gle/15kyv1ffx7tzTLโฆ. Nomination closes on 9 November 2025.
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